Between 20.20 and 20.25 hours on 15 July 1942, U-576 fired four torpedoes at convoy KS-520, the first damaged the Chilore, the second damaged the J.A. Mowinckel, the third sank the Bluefields and the fourth missed the second ship. The U-boat was lost after this attack.

The Chilore (Master George P. Moodie) was struck well below the waterline on the port side beneath the port hawse pipe. This reduced the speed to five knots as the forepeak flooded and she dropped out of convoy. The convoy commodore on J.A. Mowinckel joined the Chilore together with USS Spry (PG 64) and decided to head for shoal water to anchor. The commodore was unaware of a defensive US minefield that extended in an arc of ten miles out to sea from Cape Hatteras to two miles out below Ocracoke Inlet. As the ships headed for the mine field, a US Navy blimb dropped smoke bombs to warn the ships, but they thought it was a warning from U-boats in the area. Four hours after the attack, the Chilore struck two mines on the port side wing tanks at the #2 and #4 hatches. After these explosions part of the ship´s complement of eight officers, 33 crewmen and nine armed guards (the ship was armed with one 5in, two .50cal and two .30cal guns) and six passengers tried to abandon ship without orders. Two men fell out of one boat and drowned. The remaining crew abandoned ship and were picked up by a US Coast guard vessel and landed at Ocracoke. The master stayed on the ship until the next morning.

The Chilore was towed to Hatteras Inlet and was beached in 36°57N/76°00W. The J.A. Mowinckel was also damaged by US mines but was saved. Later the Chilore was boarded by a US Navy salvage crew and was taken in tow to Norfolk but she capsized and sank near the entrance to Chesapeake Bay on 24 July. Her wreck was sold for scrapping in August 1954.